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We estimate the production function for agricultural output in Eastern Africa incorporating climate variables disaggregated into growing and non-growing seasons. We find a substantial negative effect of within growing season variance of precipitation. We simulate predicted climate change for the region and find a resulting output reduction of between 1.2% and 4.5%. Our simulation also demonstrates substantial potential for economic benefits from mitigating the effects of within growing season precipitation variability through conventional technologies such as flexible planting and rainwater harvesting on the same scale as the potential loss from predicted climate change. [ABSTRACT FROM AUTHOR]

Abstract: Information feasible regulatory mechanisms (that do not require the regulator to acquire firm level information) have been proposed long ago for stochastic non-point emission problems. These mechanisms do not take polluter cooperation and firm entry–exit incentives simultaneously into account, nor are these issues addressed in an informationally efficient way. In this paper we propose an informationally feasible self-reporting mechanism that is robust to cooperation among polluters while giving participating firms correct abatement incentives as well as giving entry–exit incentives that are correct to a first order approximation. [Copyright &y& Elsevier]

This paper estimates nitrogen fertilizer demand elasticities for Danish crop farms using the dual profit function approach on micro panel data. The model includes several farm- specific parameters, allowing us to estimate the mean demand elasticity and test for homogeneity of elasticities across panel farms. The mean own-price elasticity for nitrogen is -0.45, and there is a significant standard deviation from this mean for individual farms of 0.24. Heterogeneity of demand elasticities implies that regulating fertilizer application through mandated uniform percentage reductions, as is currently used in Danish nitrogen regulation, increases abatement costs relative to tax regulation. Somewhat surprisingly, this causes the abatement costs of quota regulation to be only 8% larger than with tax regulation. Simulation results indicate that the primary threat to the efficiency of uniform reduction schemes comes from inaccurate estimation of baselines rather than from heterogeneity of elasticities. [ABSTRACT FROM AUTHOR]

Provision of information on the environmental effects of consumption is often put forward as an appealing alternative to traditional means of environmental regulation such as permits and environmental taxes. When consumers in opinion polls are asked if their purchasing decisions would be influenced by information on environmental or ethical aspects of products, the majority seem very ready to say yes. However, evidence for actual behavior along these lines is still limited. In this paper a mixed logit model is used to quantify the effect of a certified environmental label (the Nordic Swan) on consumers’ brand choices of toilet paper, paper towels and detergents, using a large Danish consumer panel with detailed information on actual purchases from the beginning of 1997 to January 2001. It is found that the Nordic Swan label has had a significant effect on consumers’ brand choices for toilet paper, corresponding to a marginal willingness to pay for the certified environmental label of 13–18% of the price and it also appears that information on environmental performance has had an effect on consumers’ choice of detergent. [Copyright &y& Elsevier]

Describes a nitrogen based deposit refund system for regulating agricultural nitrogen emission in Denmark. Application of regulator monitoring costs; Introduction of incentive regulation of non-point nitrogen emission; Policy implication of agricultural emission of nitrates.

The electrification of residential energy demand for heating and transportation is expected to increase peak load and require additional generation and transmission capacities. Electrification also provides an opportunity to increase demand response. With a focus on household electricity consumption, we analyse the contribution of appliances and new services, such as individual heat pumps and electric vehicles, to peak consumption and the need for demand response incentives to reduce the peak. Initially, the paper presents a new model that represents the hourly electricity consumption profile of households in Denmark. The model considers hourly consumption profiles for different household appliances and their contribution to annual household electricity consumption. When applying the model to an official scenario for annual electricity consumption, assuming non-flexible consumption due to a considerable introduction of electric vehicles and individual heat pumps, household consumption is expected to increase considerably, especially peak hour consumption is expected to increase. Next the paper presents results from a new experiment where household customers are given economic and/or environmental incentives to shift consumption to or away from specified hours. The experiment focuses on the present classic consumption and shows that household customers do react to incentives, but today the flexibility of the classic consumption is limited. Considering electric vehicles and individual heat pumps, for an individual household, the consumption of each of these technologies roughly doubles the household’s consumption and considerably increases their potential for flexibility. Thus, in order to introduce incentives for demand flexibility, while considering reducing peak consumption, policy makers should initially focus on households that have a heat pump and/or an electric vehicle. [ABSTRACT FROM AUTHOR]

• Randomized field experiment compares electricity pricing incentives. • Smart-metered hourly electricity consumption to measure treatment effects. • Dynamic prices reduces consumer surplus by half, compared to time of use prices. • Substantial economic value of predictability provided by time of use pricing. • Challenge for flexibility through dynamic electricity pricing. Flexible electricity demand through dynamic pricing 1 1 We use the term 'dynamic pricing' to describe electricity tariffs that are continually adjusted to (partially) reflect the current price at the spot market or at the day ahead market such as real-time pricing. Time of use pricing is not covered by our use of the term because time of use tariffs are pre-declared and not continually adjusted to reflect current market conditions. Note that the term dynamic pricing is sometimes defined more broadly e.g. as any tariff structure different from a flat tariff. is becoming more critical for net-balancing as the share of intermittent wind and solar electricity production increases. However, people are prone to habits and regularity, so this kind of dynamic pricing schemes may also impose a greater cost of reacting to price incentives. In a randomized field experiment we compare the household consumer welfare effects of reacting to dynamic electricity price incentives to those of reacting to time of use incentives. We utilized smart-metered hourly electricity consumption data to unobtrusively measure treatment effects. We found that a dynamic incentive of 1 DKK/kWh induced an average change in electricity consumption per household of 0.182 kWh during the 3-hour target period. The corresponding time of use incentive induced an average change in electricity consumption of 0.351 kWh. This implies that dynamic incentives reduce consumer surplus from reacting by half, compared to reacting to corresponding time of use incentives and therefore that households derive a substantial welfare benefit from the regularity and predictability provided by time of use pricing. This suggests that the tariff structure that optimally balances demand flexibility and the associated consumer welfare costs is likely a combination of time of use and dynamic pricing incentives. [ABSTRACT FROM AUTHOR]